The Redcliffe-Maud Report was rejected by the incoming Conservative Party government, but the concept of a two-tier metropolitan area based on the Mersey area was retained. A White Paper was published in 1971. The Local Government Bill presented to Parliament involved a substantial trimming from the White Paper, excluding the northern and southern fringes of the area, excluding Chester, Ellesmere Port (and, unusually, including Southport, whose council had requested to be included). Further alterations took place in Parliament, with Skelmersdale being removed from the area, and a proposed district including St Helens and Huyton being subdivided into what are now the metropolitan boroughs of St Helens and Knowsley.

Merseyside was created on 1 April 1974 from areas previously parts of the administrative counties of Lancashire and Cheshire, along with the county boroughs of Birkenhead, Wallasey, Liverpool, Bootle, and St Helens. Following the creation of Merseyside, Merseytravel expanded to take in St Helens and Southport.

Between 1974 and 1986 the county had a two-tier system of local government with the five boroughs sharing power with the Merseyside County Council. However in 1986 the government of Margaret Thatcher abolished the county council along with all other metropolitan county councils, and so its boroughs are now effectively unitary authorities.

Merseyside is divided into two parts by the Mersey Estuary, the Wirral is located on the west side of the estuary, upon the Wirral Peninsula and the rest of the county is located on the east side of the estuary. The eastern part of Merseyside borders onto Lancashire to the north, Greater Manchester to the east, with both parts of the county bordering Cheshire to the south. The territory comprising the county of Merseyside previously formed part of the administrative counties of Lancashire (east of the River Mersey) and Cheshire (west of the River Mersey).

To express location within the Merseyside area by the preposition on – thus "on Merseyside" as opposed to "in Merseyside" – was traditionally the more usual. However, the logic of suggestions in support of this from some quarters (that, after all, one would always be "on" the side of the Mersey, not "in" it) falls down; since it is, in fact, entirely possible to be situated [both] "in" or "on" [either] “side” of the River Mersey and area(s) thus designated. Therefore, more recent usage tends to draw distinctions between the geographical "Merseyside" – for which "on" is considered appropriate – and the Metropolitan county of "Merseyside", for which "in" is used.

Ipsos MORI polls in the boroughs of Sefton and Wirral in the 2000s showed that in general, residents of these boroughs identified slightly more strongly to Merseyside than to Lancashire or Cheshire respectively, but their affinity to Merseyside was more likely to be "fairly strong" than "very strong".[3]

This is a chart of trend of regional gross value added of Merseyside at current basic prices published (pp. 240–253) by Office for National Statistics with figures in millions of British Pounds Sterling.

^Sefton poll, where 51% residents belonged strongly to Merseyside, and compared with 35% to Lancashire; Wirral poll, where 45% of residents belonged strongly to Merseyside; compared with 30% to Cheshire. In both boroughs, "very strongly" ratings for the historic county were larger than that for Merseyside, but "fairly strongly" was lower.